We Discuss Why Home Federal Bancorp, Inc. of Louisiana's (NASDAQ:HFBL) CEO Compensation May Be Closely Reviewed

Key Insights

• Home Federal Bancorp of Louisiana will host its Annual General Meeting on 20th of November
• CEO Jim Barlow's total compensation includes salary of US$312.5k
• The overall pay is comparable to the industry average
• Home Federal Bancorp of Louisiana's EPS declined by 14% over the past three years while total shareholder loss over the past three years was 31%

Shareholders will probably not be too impressed with the underwhelming results at Home Federal Bancorp, Inc. of Louisiana (NASDAQ:HFBL) recently. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 20th of November. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. We present the case why we think CEO compensation is out of sync with company performance.

Check out our latest analysis for Home Federal Bancorp of Louisiana

How Does Total Compensation For Jim Barlow Compare With Other Companies In The Industry?

According to our data, Home Federal Bancorp, Inc. of Louisiana has a market capitalization of US$38m, and paid its CEO total annual compensation worth US$639k over the year to June 2024. We note that's an increase of 11% above last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$312k.

In comparison with other companies in the American Banks industry with market capitalizations under US$200m, the reported median total CEO compensation was US$602k. This suggests that Home Federal Bancorp of Louisiana remunerates its CEO largely in line with the industry average. Furthermore, Jim Barlow directly owns US$2.4m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	US$312k	US$301k	49%
Other	US$327k	US$277k	51%
Total Compensation	US$639k	US$578k	100%

On an industry level, around 45% of total compensation represents salary and 55% is other remuneration. Although there is a difference in how total compensation is set, Home Federal Bancorp of Louisiana more or less reflects the market in terms of setting the salary. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

Home Federal Bancorp, Inc. of Louisiana's Growth

Home Federal Bancorp, Inc. of Louisiana has reduced its earnings per share by 14% a year over the last three years. Its revenue is down 14% over the previous year.

Few shareholders would be pleased to read that EPS have declined. And the impression is worse when you consider revenue is down year-on-year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Home Federal Bancorp, Inc. of Louisiana Been A Good Investment?

The return of -31% over three years would not have pleased Home Federal Bancorp, Inc. of Louisiana shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 1 warning sign for Home Federal Bancorp of Louisiana that investors should think about before committing capital to this stock.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.